Thursday, October 7, 2010

Richard Walter on Mark Zuckerberg, Facebook, and the Legalities of Idea-Theft

For the unfamiliar, a "reveal" in screenwriting parlance is the placement of key, revelatory information in a story. Most times, the last reveal is the most important revelation of all.



The young WRITER approaches GURU RICHARD WALTER as he gazes absently into the abyss.

             I have been subpoenaed. I
             am accused of having stolen
             my story.

He hands over the subpoena.

Walter glances at it, then hands it back.

                  GURU RICHARD WALTER
             I suggest you settle. Life’s
             too short. Write other stories.

             But it’s the story of my own
             childhood! Growing up in Hawaii,
             then a community organizer in
             Chicago, then dabbling in
             politics! Who else could have
             lived such a life?

Guru Richard Walter considers this, then looks at CAMERA and furrows his brow.

UCLA Graduate Screenwriting Chair, Richard Walter, returns for a Q & A on the legal aspects of intellectual property and their implications for writers. Mr. Walter has served, and continues to serve as an Expert Witness in court cases adjudicating such disputes. He was an Expert Witness in the famous case concerning Art Buchwald, Paramount Pictures, and the Eddie Murphy film, Coming To America. This was chronicled in the bestseller, Fatal Subtraction, by Pierce O’Donnell and Dennis McDougal.

Before we hear from Mr. Walter, however, I'd like to examine two cases which bear on the subject.

The Social Network is a film written by Aaron Sorkin that “fictionalizes” the founding of Facebook by Mark Zuckerberg. Zuckerberg has become a controversial figure since his ascendence to billionaire status, having sold part ownership in Facebook for huge money. In the aftermath, he is being accused and sued for stealing the idea for Facebook from others. He has already paid his accusers once, in a settlement ($65 million). Now they (and another claimant) are after more.

One article on the history of Facebook’s development presents fairly damning evidence of Zuckerberg’s manipulation of events leading to his incredible success. However, even the article takes the position that the accusers were vastly overpaid considering that their original idea was for an exclusively Harvard University-based dating website, and Facebook was to be a social networking site that was expandable to multiple schools.

Of course it then morphed into a world-wide social networking site. But neither Zuckerberg nor his accusers foresaw that. The fact that Zuckerberg took it that far is due to Zuckerberg’s own efforts and the original concept’s popularity and applicability. And that had nothing to do with dating between college students on the Harvard University campus.

Moreover, one could almost take the position that the accusers took Zuckerberg’s notion of connecting multiple schools when several months after breaking with Zuckerberg they debuted ConnectU, a dating site connecting several schools, just as the initial Facebook had done .

There is no question that Zuckerberg played fast and loose with people and their ideas. But he has also now, after being brought into court, paid substantially for that privilege. After looking at all the facts, I would say he is not someone I would want as a friend. But he is a fairly typical representative of the world of business: exploit an idea, even if it began differently with someone else. After all, what idea doesn’t source out of an earlier idea? His actions don’t appear to be very different than those of the young Bill Gates as chronicled here.

In that instance, Gates manipulated people and events so that his company (the fledgling Microsoft) could license DOS, the first widely-used personal computer operating system. He purchased programmer, Tim Paterson’s QDOS (in hindsight, for a pittance: $50,000), a “Quick and Dirty Operating System (itself, based [or stolen?] on [or from] Digital Research Inc. (DRI) programmer, Gary Kildall’s CP/M operating system). Gates modified QDOS slightly, and it eventually became IBM’s PC-DOS and Microsoft’s MS-DOS. Both QDOS’s creator (Tim Paterson), and CP/M’s programmer (DRI’s Gary Killdall) reaped no benefits after Gates turned around and licensed his revision to IBM. “Big Blue” had already gone to Kildall for CP/M and had been turned away. Kildall never found out about the Gates-IBM deal until nearly a year had passed. It may be significant that Paterson never went after Gates and/or IBM for further payment for QDOS. Was it because QDOS was a direct lift of key parts of CP/M, a quick and dirty version? If it was would Gates have known that? Copyright and patent law had not yet caught up with software development by 1980. There were few, if any, real precedents for these events.

So Gates had, in IBM, a licensor. Paterson, the QDOS originator, was unaware of IBM’s interest. Should Gates have kept his $50k and simply told Paterson there was a buyer out there? Gates was in the software business, after all. Unaware of QDOS, IBM came to Gates, not Paterson. One of the IBM people even claims that Gates told them of Paterson’s QDOS and asked if they wanted to go to Paterson for it or let him do it. They told Gates to do it. So, where in that is Gates criminal or even unethical? And Kildall, the CP/M originator, had turned IBM away because he preferred to sell on a royalty basis, not license the software as IBM wanted. Should Gates have had to convince Kildall that licensing the software (rather than selling copies) was good enough, in fact the software business model of the future, and then walk away without even a commission for his efforts?

It’s true, Gates never later brought in either man as his partners. He never made any additional payments to them. But what were his obligations, under the circumstances? Who could know back then before widespread use of PCs and before the web fundamentally changed daily life as we now know it, that $50,000 was chump change? To a fledgling software developer like Gates back in 1980, it was significant. And Paterson’s and Kildall’s failure to make any claims may have been evidence to Gates and his lawyers that he need pay no one. Business, like it or not, generally doesn’t pay out unless it has to.

Kildall died tragically, relatively young (52), embittered and addicted to alcohol. But was Bill Gates the cause? Certainly he was in Kildall’s version of events. But where does Tim Paterson fit into those events? And whose version of any such events should the Law choose when it must?

It wasn’t exactly honorable. Some might say it wasn’t even ethical. As the old saying goes, “hindsight is 20/20,” but it’s no more accurate to the moment than is the history that’s written by the victors. So it may not have been right, but, so far as we know, it wasn’t illegal. Even so, Gates and Zuckerberg appear to be peas in the same pod: businessmen. Others might call them sharks… or, worse.

The interview:
LR – The implications for writers of the controversy at the heart of the Facebook dispute seems, to me, to be academic: ethics vs. letter of the Law. Anyone can lift someone’s idea and through careful writing/development, careful execution of the concept, essentially steal it lock, stock, and barrel, yet escape any culpability, any legal penalty. If the two parties laying claim to the idea both develop it, but one (not the originator of the idea) finishes before the other, are they legally wrong and do they not own 100% of what they have developed? What if only one party develops it but the other solely conceived it and intended to develop it but hadn't yet begun?  So, in the Facebook case, with Zuckerberg having already paid what cannot be denied (given the circumstances of the details) huge money, assuming they agreed it was to be a final payment (standard legal practice in such settlements), who’s right? Should Zuckerberg pay again? Or should they shut up and go away?

RW - The mistake here is over-crediting the value of an idea, be it for software or for a screenplay. An idea is just that: an idea. Once you have that, what else remains? Everything! For Facebook the code has to be written, the marketing details have to be worked out, the promotion, etc. The question talks about 'lifting' someone's idea but then goes on to discuss careful writing/development, and execution. I say the real value is in execution. Execution represents the heavy lifting and contains the true value.
LR – So, you come down on the side of Zuckerberg. If, legally, they are not guilty of wrongdoing, yet, ethically, at least they should be, if, then, we pay them for it by buying tickets, are we complicit, ethically, if not legally?

RW - No one should lose sleep over having purchased a ticket to a movie that may not have been written by the writer credited onscreen. Software, social networks, ditto. Whoever feels exploited has the right to seek remedies via litigation and in a zillion other ways.

LR - What if there is legal evidence that establishes significant intent to develop by the originator of the idea, a result identical to what the accused idea-thief eventually produced? In other words, having been beaten to the market, and with knowledge of the originator’s plan, but no evidence of criminal intent by the “thief,” does the originator of the idea have any claim to compensation from the proceeds of the “thief’s” successful efforts?

RW - Intent is in its nature always unknown and unknowable. Even individuals are unclear regarding their own intent. Everyone asks himself from time to time: "Why did I do that?" It doesn't matter what anybody intends to do, only what he does. There are indeed examples of various theories and products that were developed independently and simultaneously. It's up to any party who feels exploited to seek a remedy thorough the law or, again, in any number of ways.

LR - If it all comes down to execution versus mere idea, how does this stand up to a hypothetical case where a “little guy” in a garage workshop is beaten to market by a huge, faceless corporation, with an idea he shared with the corporation while trying to secure funding? Is there any hope for little guys, or must they “lawyer up” before sharing any ideas with anyone? Besides, who’s to say the corporation's lawyer can’t “beat up” his lawyer in the eyes of a jury?

RW - This is addressed in a little-known, fairly recent film (written by UCLA-trained screenwriter Phil Railsbach) called Flash of Genius. It's the story of the guy who invented the intermittent windshield wiper, which was subsequently stolen by Ford and another motor company. The inventor won a vast settlement, but it took him decades and wrecked his life.
LR – So, it was a pyrrhic victory. “Right” has one meaning in isolation, and another in society. By its application of Law, society acknowledges that there are many “sides” to all stories, and it can’t necessarily penetrate to a truth that matches that “right” in isolation to which we referred. As they say, “reality bites.” (It makes you wonder who really came up with the idea for Rashomon. But, seriously…)

Correct me if I'm wrong, but I recall that in the Buchwald case in which you served as an Expert Witness, there were more than a dozen points of similarity between Buchwald’s work and the film, “Coming to America.” Can you briefly outline the claim and the judgment?

RW - Some 'points' are more important than others. In infringement litigation there are substantial similarities and also striking similarities. There were only two essential similarities between Buchwald's work and Coming to America: 1) African royalty in 2) urban America. Buchwald had already been paid more than a quarter million dollars in the early ‘80s, for a slight treatment he'd written. The judge ruled that he should receive another $150,000. This is commonly thought of as a victory for him, but in fact the law firm spent over two million dollars pressing his case. He sought about eight million dollars. One of his experts thought he should get 24 million dollars. Reiterating, the judge gave him $150,000. Without any modesty at all, this was my own recommendation, that is, that any contribution made by Buchwald was trivial, frail, slight, infinitesimally small.

LR - Paul Schrader and others have said all story plots have been done. How are stories in dispute compared in court?

RW - They say that falling in love is wonderful. I don't believe we've scratched the surface of available plots. There are infinite new plots. [As concerns the question] There is an extrinsic test and an intrinsic test, and it's quite complicated. There are seven or eight criteria, many of them nonsensical, like mood, for example. Imagine stealing someone's mood! Two of them are 'plot' and 'sequence of events.' I thought those were the same thing! 

LR – So, while acknowledging the difficulties confronting the courts in such disputes, and even agreeing with their judgments at times, you nonetheless contend that the legal system employs faulty—even “nonsensical”—methodologies in evaluating disputes when it comes to stories.

When we apply the legal versus ethical dichotomy to written intellectual property such as books and screenplays, is there any real hope for non-connected "little-guy" writers coming out of “fly-over” country when trying to sell to the established industries on either coast and, then, years later, finding their story on the big screen or ghost-written and on the best-seller list?

RW - Every big guy was once a 'little guy.' Material gets stolen from time to time, but it's the exception. Even a multi-million dollar screenplay sale represents but a handful of the percentage points relative to the whole investment. Studios have no interest in jeopardizing the entire project in order to deny the writer the one or two percentage points due her.

LR - In five words or less (ha ha) what precisely constitutes theft when it comes to written stories? And are book-length works different than feature screenplays? What about outlines, treatments, synopses, pitches or mere loglines in a query letter?

RW - Generally, the shorter the purportedly purloined material (Buchwald's reiterating, was maybe five hundred words) the harder to make the case for infringement.

LR – Inferring, then, theft must be considered case-by-case. And size (or length) matters.

I’ve seen major literary agents and entertainment attorneys contending in print that exercising “The Poor Man’s Copyright” by sending yourself your script in a sealed, un-opened envelope (even when notarized), or, in fact, registering your script with the Writers Guild of America itself (!) may not hold up in court as evidence of prior ownership. So... you’ve written your great American screenplay; your government tells you that the mere act of setting it down on the page establishes copyright; you’ve had it read by two or three friends and acquaintances who will testify to same in court; you’ve also registered it with the WGA, and you have a sealed, notarized, and pre-existing post-marked copy in a safe deposit box at your bank; after all that, you sent it to Paramount; they then produced a movie with the same story and only three points of commonality--though they are highly significant and unique to the work. Have they stolen your material? What say you?

RW - Registering it with the WGA is all you really need to do, though it needs to be renewed every five years. At twenty bucks for nonmembers, that's four dollars a year. Reiterating, infringement and plagiarism occur sometimes, but they are most exceptional. This is largely paranoia. Writers should quit worrying about their material being stolen and worry instead about writing material good enough that someone might want to steal it. 

Thanks to Richard for his perspectives on these issues. Don't forget to pick up a copy of his new book, Essentials of Screenwriting, at your favorite bookseller!

I have always come down on the side of “leading with your chin” when it comes to breaking in with your writing. The potential benefits out-weigh the risks. If your writing is good enough to steal, it’s good enough to sell. Go forth and multiply (your stories). You need to get in the pool if you’re gonna swim. You could get into trouble early, you could even drown. But most swimmers find ways to keep their heads above water and eventually swim. It’s simple: be careful out there, but get the hell out there!  #


Quotes of the Post:

“All plots have been done.”
---Paul Schrader
“I don't believe we've scratched the surface of available plots. There are infinite new plots.”
---Richard Walter
“If your writing is good enough to steal, it’s good enough to sell. Go forth and multiply (your stories).”
---Lee Matthias

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